tv The Dylan Ratigan Show MSNBC December 5, 2011 4:00pm-5:00pm EST
the stuff that is coming across the blogs and the air waves. >> think carefully, because much of it is errant nonsense. thanks so much for watching. and at this time, as you know, i normal lly hand over to my colleague, dylan ratigan, but today i have no idea where he is. so where in the world is dylan? >> where in the world, where in the world is matt lauer? show me a sign, give me a clue. drop me a hint and tell me something new. >> martin, as we opened the shot here, let's show everybody the big surprise. we are currently located in a live television studio, it's basically a small closet on the third floor here at the burr banks studios. if you look behind me, martin, you'll see an image that actually doesn't exist in real life. it's that exotic. it is a conglomeration of buildings that once existed, some still do, here the in southern california, that were assembled exclusively for this closet, such that people who are in it look like they're in
california. now i've lost martin bashir. anyway, that's where i am. good monday afternoon to you. i am dylan ratigan. it's an absolute delight to be seeing you here from southern california in burbank. more on why we're actually here later in the show. i don't think that the closet surprise was really adequate. but first, a big story away from these rather silly issues. manufacturing jobs in america. as you surely know, we saw stagnant growth in the jobs market on friday, with only a net gain of 2,000 manufacturing jobs last month. that does nothing to offset the millions lost since the 1980s and the big reason, really, is china, of the nearly 3 million u.s. jobs that we've seen in china, during the past decade, more than two-thirds of those jobs or nearly 2 million were manufacturing jobs. that a direct result of american and chinese government policies, specifically tax and currency policy. even more disturbing, our tax dollars, yours and mine, are
being used to buy cheap goods from china to hire chinese workers in the industry. here's a prime example. the $6 billion project in california to rebuild part of the san francisco oakland bay bridge, which is california's largest public works project ever, thanks to washington loopholes that help to create 3,000 jobs in china, buying chinese steel for really an american icon, jobs that surely could have been and by my view, should have been created here at home. i'm not only one who thinks that way. congressman rick rahal's new bill would close those loopholes and make sure that bridges and other infrastructure projects financed by my tax dollars and yours are stamped made in america, not made in china. and congressman, how does the bill work? >> well, what you've described, dylan, is just incredulously outrageous. it's appalling. it's outright wrong. and when you see american tax
dollars going to put chinese to work, some 3,000 on this particular project, you just cannot comprehend what's happening here. the bill i introduced would allow companies to skirt the buy america provisions that are currently 60% in current law. my bill would forbid, for example, the subcontracting, which occurred on in san francisco bay bridge, to some 20 different kecompanies, allowing the companies to skirt the buy american provisions. my bill would prevent subcontracting, breaking out into smaller contracts. my bill would over a period of time raise the 60% threshold for american-made products to 100% american-made products. this goes for all the iron, the steel, it goes for railroad cars, buses. it goes for all of our improvements in our airports around this country, such as radar and the lighting system for the runways. what's happening in the san francisco area on this bay bridge is just appalling to american workers, it's an insult
to the american workers, at a time we're approaching the holiday season, at a time when we know employment is high in this country, and at a time where we're trying to pull ourselves out of a recession. this is bad and we need to close these loopholes that allow companies to do this. these are american tax dollars. >> at the same time, there are massive special interests on trade who -- companies like walmart, companies like cart pillar. theoretically great american companies, and not necessarily evil people, by the way, but they are institutions, massive corporations that are effectively chinese export companies. their set up in china and exploiting the 50% currency discounting and they send their money to politicians like yourself, and they say, we will fund your campaign if you don't mess with the chinese trade agreements or the chinese currency rigging or the chinese tax rigs. do you feel you can navigate for politically on what is a layup issue. you would not think this would even be a political battle for
you, quite candidly. and the absurdity is that it probably will be. do you believe that you can navigate against the formidable resistance of the multi-national corporations who lobby our president and both political parties with their money to prevent engagement that would reconcile these trade inefficiencies because it would be a direct threat to, for instance, walmartover caterpillar's projects? >> first, i'm unaware of any obligations i have to the companies which you've referenced. but it will be an uphill slog. you've described the situation here in washington right on. the tentacles of these major conglomerates not only reach worldwide, they reach throughout the halls of congress. so, yes, it will be an uphill battle. you referenced the chinese currency. you've seen the struggles we've had in trying to get that legislation through the congress. and this buy american proposition, while it evokes no opposition on the surface, underneath, you can imagine when the rubber hits the road, so to speak, that the opposition will come out to this bill.
but it should be a layup. you've described it accurately. it should be a layup, an easy bill for congress to pass. and we hope to have it as part of a major rewrite of our transportation bill that we have to do early next year. >> at the same time, when you pursue an issue like this or you have conversations that are layup issues in health, layup issues in -- forget major overhauls. this is idiotic. you don't have to be a genius to know that spending our taxpayer money to build infrastructure for us in our country while buying steel from china is dumb. and not for a long list of reasons, but at the same time, the barrier to resolving all these dumb things, if you forgive my language, is the role of money in politics which then presents people from really engaging in the obvious resolution, because those with the money have the most incentive to spend the most money with politicians opposing you, and everybody else has less of an interest, because they're not threatened by the bill. how do we navigate through that sort of absurdity?
>> well, i hope when the american people, especially those that are looking for work today, that are unemployed, when they see these i-beams, when they see these 42,000 tons of steel stamped with "made in china," when they put their eyes on that insignia, i hope it will cause them to contact every member of congress, every u.s. senator, everybody at the white house to get behind this legislation. that ought to be stamped with "made in america." and for american taxpayer dollars to be going overseas to hire 3,000 chinese workers who have not even done a project of this nature before, who are inexperienced, to hire them as engineers and polishers and workers on this project and then ship it here, across the pacific, to be put into the san francisco bay bridge, is just absolutely absurd and i hope if the american people will see "made in china" stamped on that steel, it will wake the entire country up. >> and the issue is, having been at this for a few years, with so
many of these types of issues, when you look at it, it is very difficult for the american people to have faith -- they know that these things are here, but when they hear about the insider to how congress is exempted from insider trading, and all these -- and the money that comes into the political coffers, 94% of the time, the he or she who raises the most money wins. that's an auction. it's not an election, quite candidly. and then we hear politicians like yourself bring us the obvious solution to obvious issues. first off, i think people scratch their head and say, that w wasn't a law already, that we have to buy our own steel? and what i would like to know from you is how i and the others, hundreds of thousands of people, can help you as you engage this sort of -- this auction system that is very effective at stopping anything from happening. >> well, you know, members of congress, first and foremost, do respond to the constituents that sent them here to washington. above and beyond, the special interests here in washington, the vast majority of congress
does respond when they hear from their constituents at the grassroots level. so that's what it's going to take. every member of congress, when he or she goes back to the district during this holiday period, should be hearing from their constituents about this outrageous insult to the american worker. and that should cause them to come back to the halls of congress, wanting to know about this legislation, putting their name on it as a co-sponsor, and then the momentum builds and the pressure builds upon the leadership, on both sides of the aisle, to pass it on the floor of the house and send it down to the white house for a signature. by making it in america, we can truly make america work. that's what this is all about. and that is so needed today, to pull us out of this recession, to get our economy back to work, to invest in america, american-made bridges, american-made railroad cars, american-made runways, american-made lighting systems, radar systems, it all should be american. >> we get it. yeah, hear, hear. >> and you know, we're entering the holiday period. and we're no longer buying cheap
trinkets from china, dylan, we're buying expensive bridges from china. >> meanwhile, american steel and american rubber and american component makers, who in an unrigged currency environment, i would argue, would provide a superior product, are getting closed out. we know it's going on and i'm delighted to know that you're on this to solve it and you surely have our full support in confronting those that would oppose you, congressman. thanks so much for your time tonight and thank you for your efforts in this matter. >> thanks for having me, dylan. >> nick rahall out of west virginia. up next here, the city of los angeles poised to send a major message in the fight to get money out of politics so we don't have to worry about silly things like we were just talking about. we are joined by the woman behind the movement in l.a. in just a moment here. also i head, christmas on "k" street. the lobbying blitz, the explosion of secret money to make sure there's no coal in the special interests who pay the most money to our politicians. plus, a big oops. take a look at the most
expensive car crash ever. ouch! you're watching "the d.r. show," live from california, only on msnbc. [ male announcer ] drinking a smoothie with no vegetable nutrition? ♪ [ gong ] strawberry banana! [ male announcer ] for a smoothie with real fruit plus veggie nutrition new v8 v-fusion smoothie. could've had a v8. this season's hottest games and...sweatbands. ♪ boom, boom, boom, gotta get-get ♪ ♪ boom, boom, boom, gotta get-get ♪ ♪ boom, boom, boom, gotta get-get ♪ ♪ boom, boom, boom it's like looking into the sun. ♪ boom, boom, boom we're rocking the beat, kids! wow. [ male announcer ] get low prices on this season's hottest games. like the black eyed peas experience for kinect for xbox 360. rated t for teen. backed by our christmas price guarantee. save money. live better. walmart.
but my nose is still runny. [ male announcer ] truth is, dayquil doesn't treat that. really? [ male announcer ] alka-seltzer plus fights your worst cold symptoms, plus it relieves your runny nose. [ deep breath] awesome. [ male announcer ] yes, it is. that's the cold truth! we asked total strangers to watch it for us. thank you so much, i appreciate it, i'll be right back. they didn't take a dime. how much in fees does your bank take to watch your money ? if your bank takes more money than a stranger, you need an ally. ally bank. no nonsense. just people sense.
we're back in the closet here in burbank and we're talking voting rights gone wrong. the naacp out today with a new report that shows that black and hispanic voters are being targeted for voting restrictions. these are two of the most disenfranchised groups of voters in a country that now has voter participation rates that are a fraction of other western democracies and our numbers
could be driven even further lower in the polls. the study found that 14 states now have measures directly attacking voting rights, including reduced early voting time and requiring photo government-issued i.d.s. bear in mind, there are some who would argue that voting either be done on a national holiday or should be mandatory. with us, michael teegan, president of people for the american way, which is a leading voice on defending not only constitutional freedoms, but the basic issues of american fairness. group is celebrating their 30th anniversary tonight here in l.a. they were, of course, originated under the leadership of norman leer, who really showed america in the context of content, michael, what it means to look at an entire society through the lens of, obviously, of all in the family, the jeffersons and so many others. what you are doing is seeking to engage an entire society for all of its warts and all of itse s a
aspects. educate us as to the effectiveness of somebody's ability to restrict voting. if i change policy, how much an an impact can a policy have on voter participation? >> well, thanks for having me. it's a matter of national concern in your lifetime and everybody listening on this television show, will know that voting rights have expanded over our lifetimes. and in the last two years, we've gone in full reverse. that the money in politics part of that has been to try to limit people from voting, and that is for restrictive i.d. policies, that's doing anything they can to throw up obstacles to getting people the right to vote. >> and what would be -- who wins to less people voting? >> well, i think the answer is pretty out there. and we've seen that the corporate right in terms of them putting money into organizations like the american legislative exchange council that have a
vested interest in less and less p people voting, because then they can get their way. you look at 2010 in that election. by having less people voting, it was better for turning back a lot of the progressive legislation that's been gone, that's been put into place over the last 100 years, all in one election. so, you know, there are many people who want to have less people vote and make it more restrictive. >> and give us a little bit of insight into people for the american way, and the foundation that you run now, and what your direct relevancy is to this issue and money and politics more broadly. >> well, it's interesting. we were started 30 years ago to fight the religious right that was largely trying to influence democracy. well, now that's changed. we now have the corporate right that is going arm and arm with them in order to try to subvert democracy. and so what we are doing in every way possible is to try to help people get registered and get them to vote and get them ready to vote.
because unlike in the past, getting them registered and getting them out to vote is only half the game. because then they've got to know how to actually get their rights and to be able to vote, because they have right i.d., and they're not being restricted from voting. so we're doing that. it's educating people, it's getting people to the polls, and it's also making sure that the american people are aware of what's going on here. i don't think very many people have an idea, because it's very antithetical to our idea of democracy that there are people trying to limit what we're trying to do. >> thus, it is wonderful that we have things -- people like your foundations and tv shows so we can talk about it. we'll expose this as long as we have to, michael. thank you for bringing this to our attention this afternoon as the electoral process itself is only obviously as good as its ability to actually measure the
desire and intention of the people voting. if the system doesn't do that, then what exactly are you doing. we'll talk to michael soon rather than later. thank you, michael. >> thanks so much. welcome to l.a.. >> nice to be here. thanks for having me. moving forward, as we look to our own congress, as they prepare for the recress, all lut house of representatives, not a creature, literally, is stirring, period. just weeks now, until the payroll tax deduction expires, both parties playing scrooge on how to pay for it. the president urging some holiday spirit. the theater and pro-wresting spirit is as prevalent as ever. >> the payroll tax is important for individuals as a whole, but also important for families. it will help families pay their bills. it will spur spending. it will spur hiring. and it's the right thing to do. >> so "k" street, where the money comes from, hoping it's going to be a merry christmas,
lobbying for congress to flaw the part of santa claus. on the wish list, tax perks, credits, and other goodies worth $30 billion to them at our expense over the next decade. good thing for the lobbyists it's an auction, not an election, so they'll probably win. the monday mega panel is here, however. you can see all three of those handsome and beautiful smiling faces. imogen lloyd webber, tim carney, and sam seder. if you were to look, accepting the impasse, accepting a lot of the dysfunction that exists in the decision-making process, tim carney, i sort of -- if we were to equate the american government to a dysfunctional board of directors that refuses to talk to each other, that refuse to even make a decision about the economy, and we, the american taxpayer, are the shareholders that are just getting annihilated because our board is a bunch of fools, if you were to look at the current body of issues, is there any place that anything could be done between now and the end of the year? >> well, theoretically, the tax
credits and the corporate handouts you're talking about would be great middle ground. this is where sam and i agree. i think imogen probably agrees that there shouldn't be an ethanol tax credit. there shouldn't -- maybe i could even get some liberals who agree with me that we should get rid of some special tax credits that help the solar companies, that help companies like ge put up these windmills that might not produce any energy, but basically amount to corporate welfare. but that's sort of right and left, liberal and conservative agreement. it doesn't amount to republican democratic agreement, because when they get together, it's the middle, it's the more corporate-owned guys, as you would put it, in both parties, who meet together and they extend these subsidies. you will find agreement, but i think it's agreement that's harmful for the country and these goodies will get put under the christmas trees. >> sam? >> i agree with tim largely. usually when you see republicans and democrats getting together on something these days, it ends up being bad for the country . p i mean, the best thing that
happened, as far as i'm concerned, is that the super committee was completely deadlocked. now if they could reverse their deal in the first place, they'd be better off. >> imogen, it's interesting, and really with these panels, and you've seen it as well as i have, you can't find two people that hate each other more and disdain each other more than tim and sam. look at them, they won't even sit in the same room together. and yet we can have this conversation and they can find a wide variety about topics they're at least willing to engage in a debate about, whether it's the integrity of tax policies relatable to businesses, whether it's the integrity of rule making that affects business and development. and yet because both of the political parties aren't even representative of what you would really representatithink those policy, doesn't even exist inside these two political parties. >> i think those attitudes are
going to have to change. fundamentally, we're reaching a tipping point here. americans are upset. fundamentally, this is an amazing country. it is the powerful stability of this country. yet, recently, washington, d.c., now, is the world most metropolitan area in america. it is overtaken silicon valley. let's face it, there's too much money going on in washington. money has to be got out of politics, to get back to that american dream. and i think fundamentally, americans are now starting to fight for that dream, to fight for that freedom, that quite frankly is migssing at the moment. >> dylan, we have to also be honest. i don't agree with everything the democratic party does. and these days, less and less, they've adopted a whole rhetoric about cutting the deficit that i think is wrong and this and that. but we would remiss and we would be ignoring reality if we didn't mention that at least the democrats seem to have some type of policy positions. the republican party has no policy positions. all they have is obstructionism. at one point, they're concerned about the deficit. the next thing, they don't care
about paying for tax cuts. >> i'm going to cut this off, just because it's going to go nowhere fast. and i'm not trying to deprive you of fair time, tim, by any stretch. i just think that all those proposals, whatever the proposals are, they don't address our problems, because the democrats' proposals, we saw them on banking, we saw them on health care. they may be good for some sort of fund-raising for the democratic party, but they don't do much for investment or health. the panel stays. our specialist joins the conversation and another voice joining the growing debate in this country. are corporations, in fact, people, and is money, in fact, speech? where do you come down? i'm still figuring it out myself. our specialist joins me after this. ttd# 1-800-345-2550 ttd# 1-800-345-2550 let's talk about the typical financial consultation ttd# 1-800-345-2550 when companies try to sell you something off their menu
ttd# 1-800-345-2550 instead of trying to understand what you really need. ttd# 1-800-345-2550 ttd# 1-800-345-2550 at charles schwab, we provide ttd# 1-800-345-2550 a full range of financial products, ttd# 1-800-345-2550 even if they're not ours. ttd# 1-800-345-2550 and we listen before making our recommendations, ttd# 1-800-345-2550 so we can offer practical ideas that make sense for you. ttd# 1-800-345-2550 ttd# 1-800-345-2550 so talk to chuck, and see how we can help you, not sell you. ttd# 1-800-345-2550 is best absorbed in small continuous amounts. only one calcium supplement does that in one daily dose. citracal slow release... continuously releases calcium plus d for the efficient absorption my body needs. citracal.
all right. the growing chorus of get money out voices in our nation could be getting some backup from one of the largest cities. maybe new york won't do it and d.c. won't do it, but l.a. will. the los angeles city council votes tomorrow on a resolution that calls on congress to amend the constitution to clearly establish that only living, breathing human beings are afforded constitutional rights. corporations, by their measure, not people. it does not address whether money is speech, mind you, but it does escalate that great 28 debate even further. and if it passes, l.a. will become the first major city in the united states to declare that corporations, that for at least this particular sliver of america, are not people. and they've got plenty of support. polls repeatedly reveal an overwhelming majority of us agree that people are people, who have had empirical research, and that corporations are not. to that end, now 255,543 people
are signed our petition to push for this great 28 debate, to get money out of politics, to look at whether corporations are people, to look at whether money is speech and come to an amendment that will drive it out. mary beth fielder is behind the push for the amendment here in los angeles. and it is an absolute delight to welcome you. i'm a little confused. what -- do you have actual evidence, do you have science that proves that people are people, but that corporations are not people? because there seems to be some confusion? >> that's an interesting question, dylan. what makes a person? i think, you know, people are born, people die, people marry, people have moral centers. and the last i checked, a corporation is a business entity, chartered by the state, whose primary purpose is to
amass profit for their shareholders. i don't think they have a conscious, per se. they can live indefinitely. they reside in many places at once. they have the collective power of thousands of individuals who work for them. so as far as i can see, i don't think that makes a human being. >> and so to that end, what is it you hope to achieve with this resolution, and obviously, the ability not just to send a message to los angeles, but in so doing, to send a message from los angeles to america? >> well, the resolution is a message to our elected officials that we are very serious about wanting to put the people back in control of our government. and to make our politicians and our elected officials answer to both to us, the people, and not to the special interests, wall street, the big business corporations that are their donors. so, basically, at any given
moment in time, through majority rule, develop the policies and pass the laws that they feel are in their best interests. >> sam? >> yeah. i'm curious, what else can follow from this? i mean, if we do get to a point where we can say that corporations are not people, we can regulate how much money they spend in campaigns. what other, sort of ancillary benefits come once we make that decision? >> the revolution not only calls for revoking all constitutional rights but clearly establish that money is not the same as speech. so this gives us back the power to pass the kind of regulations and laws that we see fit to, if we want to, like, i think dylan's amendment calls for basically allowing not any corporate money or any big donations in the political
process. at least for national elections. i mean, it gives us the power to make the kinds of laws we want. you know, different states might make different laws, but at least it's the people engaging in the debate and making those decisions based on democratic rule. >> kim, walk us through what you would see -- channel your best conservative and explain to me and all of us as to where this runs afoul of what you would perceive to be the most aspirational conservative values? >> well, i'm actually going to channel the average liberal viewer of msnbc and say, i don't see why we want to increase the government's ability to say who can and can't participate in politics, in what particular manner. for instance, you had on, dylan, the guy from people for the american away. they are incorporated on delaware. here we are on msnbc, again, owned by comcast and ge, so the freedom to assemble -- >> i got your point, tim.
i'm not cutting you off, i just want to take the question to mary beth -- >> freedom of assembly, and freedom of press -- >> i understand, i understand. >> well, one thing i -- >> mary, there's an issue with people who can accumulate attention, like myself, who have a disproportionate advantage over people who cannot, and i look at that as a separate issue from money in politics, but equally dangerous. it sounds like other folks think that it's the issue. how do you reconcile the attentionmongering that is form of capital, basically? >> the attentionmongering. well, i think -- >> so the fact that -- yeah. >> so you're talking about the money equals speech aspect of it? >> well, i want to talk about the free press. >> it's more a matter that certain people have the privilege of going on television and have a skew -- and people pay me to go on tv and express a point of view -- >> but i don't think you would -- >> well, let me just say this. let me say this. that our amendment language that was introduced a few weeks ago
by david cobb, co-founder of move to amendment, makes a specific point of saying that nothing contained in the amendment has been construed to abridge the freedom of the press. so i think this is the press, and, so, it's not about -- it's not about the -- and let me also -- >> tim, we'll come back. i want to get imogen in. go ahead, imogen. >> romney said at a campaign stop in august, and i quote, corporations are people. that must really worry you. >> well, it doesn't really worry me. because i have to say that i just find that everybody i talk to, you know, if they know about this issue, they think it's ridiculous that everybody knows that a corporation is not a person. and if they don't know about it, once they find out about it, then their eyes pop out of their head, and they say, that's ridiculous. i mean, i have to say, just yesterday i was talking to my evangelical christian sister, who i love dearly, who loves in texas, and i was telling her about what i was doing and about the issue, and she was
completely on board. and i think that people -- americans across the political spectrum agree that it is the citizens of the country who should be determining the laws. and as we become a more participatory democracy, and as our government actually reflects our will, then i think that the view offer government will become a much more positive thing. but we have the ability -- it's our right, as citizens, to pass laws. the trouble with this corporate personhood is that corporations claim these constitutional rights to overturn our democratically enacted laws and thwart ourwill. so -- and that's why it's also so important that i feel that it's not just focusing on citizens united, which is the most recent and blatant example of this, but there are other constitutional rights that corporations have claimed for themselves that have very serious implications for the environment, for worker safety, and for rights of communities to protect local businesses and, so, you know, if it's wrong in
the first amendment, it's wrong for all of the amendments. and we have to just clearly establish that it's us, the people, who are meant to rule. >> listen, it's an absolute pleasure. i'm thrilled to meet you by way of television, mary beth, and we look forward to seeing the impact in the ripples that i think los angeles is uniquely positioned to deliver to those in new york and washington, d.c., who are so vested in retaining the incumbent structure, i think it's going to require a meaningful lob from out here to get the wake-up we need in those numbed, they're sort of so intoxicated by the money, they're literally, i think their brains have gone numb. anyway, mary beth, this is wonderful. we'll talk to you soon. as well to the megapanel, we'll talk to them soon. coming up here, the costliest crash ever. and this one, for a change, wasn't on wall street. i wouldn't do that. get married?
no, i wouldn't use that single miles credit card. nice ring. knock it off. ignore him. with the capital one venture card you earn... double miles on every purchase. [ sharon ] 3d is so real larry. i'm right here larry. if you're not earning double miles... you're settling for half. really? a plaid tie? what, are we in prep school? [ male announcer ] get the venture card at capitalone.com and earn double miles on every purchase every day. what's in your wallet?
well, have you ever seen $4 million worth of luxury cars all together, maybe a car show or something? well, here's an idea of what that kind of money will get you if you want to throw it around on cars, eight ferraris, three mercedes-benz, and a lamborghini. beautiful, isn't it? typically when there are graphic images on tv, we warn the feint of heart to look away. and if you love cars, i warn you to do so so right now. because these are those cars i just described, but as $4 million worth of luxury scrap metal. 14 cars were involved in what some are calling the most expensive car crash ever. it occurred in japan over the weekend. it started as an outing of luxury car enthusiasts. but the lead ferrari slid on the wet roads, crashed on a guardrail, took out nine cars behind him! the mercedes and two toyotas
crashed when debris from the guardrail threw over it into oncoming traffic. ten folks were taken to the hospital. fortunately, all the injuries were minor and obviously maybe some shock over the hit their wallets just took. i would personally blame all of this on that all-state mayhem guy. but i do think this one's a little drastic, even for him. coming up here, we're opening up the "greedy bastard$!" glossary to define the $700 trillion monster that is sucking our economy dry. i'd like one of those desserts and some coffee.
sure. cake or pie? pie. apple or cherry? cherry. oil or cream? oil or cream? cream. reddi-wip uses real dairy cream. nothing's more real than reddi-wip. at bank of america, we're lending and investing in communities across the country, from helping to revitalize a neighborhood in brooklyn to financing industries that are creating jobs in boston or providing funding for the expansion of a local business serving a diverse seattle community and supporting training programs for tomorrow's workforce in los angeles.
well, if you've been watching the show, you know that we're fast approaching for january release of my book, "greedy bastard$!." see that cover? it's like batman. more on the release later, because right now i want to add anothetheme to our "greedy bastard$!" glossary in anticipation of the conversation that will come up in january. we started last week with the idea of how, not how much, with hot-spotting. well, today i want to introduce you to the world of swaps. because quite simply, it is the "greedy bastard$!" favorite innovation of the past decade. we're paying obscene amounts of subsidize it, even though we don't know it, and we've got to fix it. the whole idea of credit default swaps may seem a little daunting, but greedy bastards are loving that thing. swaps are an unregulated insurance policy. they're an insurance policy that bets on whether people,
businesses, or even countries will default on some future stream of loan payments. it's like a way to bet on whether a country or anybody will pay their bills. it's made a little more complex because the bets are made in secret. we can't see who bet what with who. and if you're a aaa rated financial institution like a jpmorgan, you don't have to put any money down when you bet. and now the global swaps market equals $700 trillion worth of debt. a lot would cancel themselves out if they were in public. investor bankers created the idea of the swaps back in the '90s, so they could, a, sneak around the strict regulations on normal insurance, car health insurance, life insurance, credit insurance for some reason is different. as banks' traditional businesses, because of technology, were becoming remarkably less profitable. stock trading, bond trading, stock underwriting. now the bankers are literally
able to bet, if they're aaa financial institutions with no money now, hundreds of trillions of dollars on which country or company will or will not be able to pay their bills and because these policies, these bets are secret and unregulated, no one, no bank ceo, no treasury fish, no one at the federal reserve, no one anywhere on the planet earth, because there's no exchange and no transparency, can actually make sure that the bankers are able to pay the insurance lames that they're betting. no one can do it. we watched the last week when banks paid out through those swaps lines fundamentally using western taxpayers' currency to say that they will pay any of these bets. meanwhile, the banks continue to protect premiums on the insurance they're selling, but they cannot pay for it. think of it like i was selling you insurance on your house because i hosted a tv show, and when your house burned down, i said, i can't do anything about that, but i'm a giant bank, so i have leverage to the force the taxpayer to pay.
joining us to discuss why swaps even exist are dan flebill flecn and dan gross. bill, this idea of ensuring a credit or a loan like this had some merit at some point for some things, did it not? >> yes. let's be clear. swaps are a slightly more generic term than the credit default swaps, which you are dw describing, where this has sort of betting on someone else's house burning down. in a swap, let's say you had a mortgage that was a floating rate mortgage, dylan, and it was 1% and it was going to go up every time the fed raised rates. let's say i had a mortgage that was 5% and it was fixed. and i became concerned that i was being stupid for paying 5% when you were paying 1, and you became fearful that your 1% rate was going to go to the moon, because you thought rates were going to rise. we could enter into an agreement whereby i would pay your mortgage and you would pay mine, and we would have a swap.
that's kind of how it started. and then the fun began and all sorts of various deviations of that happened. we could swap lottery tickets and decide how much we could pay to own the other person's lottery ticket and all of that. the area that you're particularly focused on of credit default swaps is a drifuation of that and there are lots and lots of type of swaps out there, but probably the most dangerous is the one you're talking about. >> and what's most dangerous about it, dan, forget what we've already discussed, there's no exchange for this, so you can't call the federal reserve, you can't call the treasury, you can't call the ecb, you can't call jamie dimon, lloyd blankfein. there's no one you can call who will tell you what the exposures are. that has to be an act of insanity. is there another financial market out there that's invisible like this? >> i think there might be a gold market somewhere in bahrain that acts on that lack of
transparency. but we really solved this in 2008, when all of a sudden, aig, we just thought aig was a sponsor of the manchester united soccer team and this big insurance company. boom, it turned out they were -- had sold, you know, hundreds of billions of dollars of insurance, credit default swaps on subprime mortgages. and when it came time to collect, they hadn't put aside any reserves, and investors in aig were not clear what the exposure was. so that is a big problem. and i think, you know, one of the most absurd components of this is the idea of credit default swaps on sovereign governments, including the united states. people are trading credit default swaps on whether, you know, the united states will make good on its bonds. and why is that absurd? well, in a world in which the government is not making payments on its bonds, what financial institution would be alive and function? >> right. yeah. >> we would all be in the hills digging potatoes or something. >> and to that end, it's something i talk with dick
grasso who used to be the chairman of the new york stock exchange bill in the book, how do you discuss all these swaps that don grossman was just referring to, where there is no underlying loan, there is no underlying coal purchase or pork purchase or anything. it's purely a bet. and mr. grasso suggested we reclassified all those types of agreements as online gaming, because they're not really an investment product. do you believe that that's too harsh? >> it probably is, because, let's say that -- let's take greece's credit default swaps, for instance. three or four years ago, you could buy them at ten basis points over, and of course, that was when there was hardly any spread. let's say i had legitimate business interest in greece as a foreigner and i might want some type of protection, i might want to do something like that. there is a legitimate basis for some of these things. if we had some regulation and some daylight on the issue, we might be able to say -- yeah.
if you had a legitimate business interest, it might not really be gambling. and you might want to treat that one way. if you wanted to be a gambler, the guy on the other side of your gambling might need a deferent instance of credit. but if we had some daylight on it, it might be a lot better. >> just to wrap it up, dan, a first step would simply be the daylight that bill speaks of, just moving to this an exchange-type environment, so we can talk about it without being so ignorant of it. >> right. and we've seen this with every other product out there, whether it's stocks or bonds, when you put something on a centralized exchange, buyers and sellers meeting, it tends to lower transaction costs and takes a fair amount of the friction out of this, as well as a lot of the secrecy. >> yeah, so listen, as you can tell, we talk a lot about in the book about putting swaps on exchanges and thanks for helping enroll others in understanding why a crazy sentence like that could be helpful if our economy. bill, dan, thank you so much.
and if you are looking to hear more about these specific regulations, we will do that tomorrow on the swaps market. and if you can, until then, check out our two brand-new podcasts. they are now known as "greedy bastard$!" anecdotes, and they're up at dylanratigan.com and on our facebook page and twitter and all the rest of that. we're one on one with risk analyst chris whalen, he's got a good anecdote. and great chen morgenson, who's broken some of the biggest stories about the lack of transparency in this market. and chris matthews teed up here, just seconds away -- well, minutes, really. "hardball" with presidential viewed through a funhouse mirror. chris matthews deeming donald trump the ring master of a republican clown show. but, do you have ever rant rage? i don't know. ke keli goff with how to deal with
real, objective investing help? that's a little harder to find. but here's what i know -- td ameritrade doesn't manage mutual funds... or underwrite stocks and bonds. or even publish their own research. so, guidance from td ameritrade isn't about their priorities. it's about mine. straightforward guidance. that's what makes td ameritrade different. ♪ [ male announcer ] trade commission-free for 60 days. plus get up to $600 when you open an account.
well, it's monday, which means it's time for keli's daily rant. take t away. >> super lawyer alan dershowitz recently told "new york" magazine he's considering publishing a book of the hate mail he's received. if he doesn't, i just might. i've certainly received enough hate mail and nasty comments of my own in cyberspace to fill a book or two. i have a working title for book one. how about, "hey, your writing sucks, but not nearly as much as that outfit you wore on tv yesterday." a friend asked me if i mind it when people make nasty comments about my work. as i explained to him, not at all. receiving unflattering feedback doesn't bother me, but receiving
no feedback at all would. if you're a writer and no one's criticizing your work, that means very few people are actually reading it. one thing that does get under my skin when it comes to my critics, poorly crafted criticism. it never ceases to amaze me how someone who is willing to take the time and energy to offer harsh criticism can do such a lousy job at it. so if you actually want people to take your criticism seriously, here are a few tips. first and foremost, actually read what you're talking about. i lost count of how many times someone has sent me a letter or left a comment, taking me to task for not saying something in a column. only, i did say it, in the second paragraph, which the person apparently didn't bother reading. apparently this behavior has become so rampant, the media site gawker is banning comments that demonstrate the commenter has actually bothered reading when they're commenting on. and if you disagree with something, say way. that ranks up with stopping
someone on the street and say, i don't like your outfit. but if you say, i disagree with your piece because i don't agree with x and here's why, you probably made their thought process better. and avoid name calling. if your goal is to actually change someone's mind, name calling is not an effective way to achieve that goal. it is effective for making sure i and anyone else you're writing or critiquing doesn't finish reading your letter or comment. lastly, if at all possible, be funny. anyone who's ego allows him or her to do a job that involves being in the public eye should have the capacity to laugh at herself. if she doesn't, she's in the wrong line of work. with that in mind, i look forward to reading the hate mail that this rant generates. the funnier, the better. dylan? >> very well done, keli. that'll do it for us today. i am dylan ratigan, live from the closet here on the thrd floor of the burbank building. and we will see